Fab Lab in developing countries has different operational problems. Within the constraints of resources, they have to prove effectiveness and the impacts of utilization of Fab Lab for their community. Vigyan Ashram (VA) Fab Lab was started in Pabal, a small village in western India with the support of MIT and Fab Foundation in 2002 and has been operational since then. It was started in a small 150 sq.ft tin shed with few machines. This lab is used by rural youth mainly, school dropouts. As the utility of the Fab Lab was experienced by the community, the lab grew in size. It saw three phases of expansion in terms of physical space and machinery. This paper is presenting challenges faced in this evolution in terms of machinery, inventory, infrastructure, manpower and projects. It is also presenting different approaches tried by VA to overcome these challenges.